Creating Profit Through Alliances - business models for collaboration E-book | Page 12

may leave out, reduce, enhance or create. The
objective is to develop a completely new market area
without competitors.

Decide where to differentiate in the
value network

There are many search engines such as Google, but it
has achieved a level of name recognition everyone
else can only dream of. Thanks to that name
recognition, Google draws lots of visitors, and so a lot
of advertising revenue, and so a lot of opportunities
to develop new services and, with that, new business
models.
Who might be able to knock Google off its throne?
There's Ixquick, a search engine that was the first to
be awarded the European Privacy Seal, which deletes
search data after two days. Ixquick offers privacy that
you cannot (or no longer) get from Google, and that
is what makes it stand out. However, Wikipedia too
could develop into a search system based on a
completely different business model, with volunteers
keeping th e knowledge up-to-date, while it yields
more relevant results because of manual selection.
In short: successful businesses create new supply in
those product groups or markets where they are the
only ones. They bring their business model in line
with customer needs not yet fulfilled by others. This
is how they develop a small monopoly, enabling
them to set the prices themselves and to maximise
their profits accordingly.

In order to work up to a specific distinction, you need
an insight into the activities before and after you. This
knowledge will help to identify unserved needs in
the market, which offer the potential for profitable
business. The value chain or, as we will see, the
value network will help you with that. In addition,
you need to know what you are really good at.
The value chain is the succession of activities needed
to supply a product or service to the ultimate
consumer. To that end, the terms 'product column' or
'business column' are used. A generic value chain for
a product is shown in Figure 3.

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